A House of Commons Library report shows that thousands of families could lose up to a sixth of their income due to a combination of NI changes in the Budget and earlier cuts to universal credit. The research shows self-employed single parents with two children who earned £10,000 a year would lose 16 per cent of their income in total once all the changes came into effect.
What’s more, wealth taxes are set to soar, costing families more than £80 billion over the next five years, figures from the Office for Budget Responsibility (OBR) show.
According to the findings, in 2015-16 the Treasury earned £11.8 billion from Inheritance Tax (IHT) and Capital Gains Tax (CGT), but in 2021/22 it will make £19 billion from them – a 60 per cent rise.
The OBR expects HM Revenue & Customs to collect £54.9 billion in CGT between 2017/18 and 2021/22, and has also pencilled in £27.7 billion from IHT over the five years.
This comes on top of the extra £1.5 billion the Treasury is set to collect over the next five years following a rise in probate fees.
Mark Littlewood of the Institute of Economic Affairs says taxes on wealth were “wrong” and called for a significant reform of IHT and CGT.
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